Dish TV Q2FY22 revenues decline 15.1%; ad revenues up 39.2% at Rs 116 mn

Dish TV India reported unaudited consolidated operating revenues of Rs 7,181 million for the second quarter ended September 30, 2021, a decline of 15.1%. Dish TV’s Q2 FY2022 subscription revenues stood at Rs 6,445 million, a decline of 15.8% from Rs 7,657 million in Q2 FY2021. The DTH major recorded a net loss of 45.1% in Q2 FY2022 with PAT at Rs 354 million, compared to PAT of Rs 645 million in the corresponding quarter of the previous fiscal. EBITDA was Rs 4,270 million, while EBITDA margin was at 59.4%.

Focused Notwithstanding Distractions

It was business as usual at India’s leading DTH company despite some chaotic developments on the corporate front towards the end of the quarter.

Staying focused despite distractions, Dish TV India tapered down its debt to Rs 5,566 million, while adding more than 0.6 million subscribers at the gross level. At a net level though, the company recorded negative additions prioritising repayment of debt over adding fresh subscribers.

The company repaid debt of Rs 697 million during the quarter to arrive at a closing debt of Rs 5,566 million.

Retention and upgradation focused campaigns continued in line with the objective of increasing the lifetime value of subscribers. Further, to increase stickiness, ‘Watcho’, the in-house OTT app of the company, was loaded with fresh curated content. The platform debuted several new web series to further enhance the complimentary bouquet of offerings for Dish TV India subscribers. ‘Watcho’ continued to gain strength as an OTT platform with a strong semi-urban presence in addition to a significant Tier 1 visibility. The app has recorded total cumulative downloads of 36 million so far.

Anil Dua, Group CEO, Dish TV India Ltd, commented, “We continue to remain focused in our efforts to drive business performance using tools that enhance the viewing experience of subscribers on both, the traditional as well as the OTT offering. We remain sensitive to changing consumer needs and look forward to new launches and a wider audience base.”

During the quarter, Dish TV India announced the launch of its ‘QR Scan Feature’. The scan to pay feature aims at giving customers a hassle-free single click payment experience when it comes to recharging their Dish TV account or paying utility bills. Dish TV and d2h subscribers will now be able to pay their bills in a few simple steps by scanning the QR code on the company’s websites – www.dishtv.in and www.d2h.com – using any UPI app or wallet. UPI is currently the easiest and the most secure way of digital payments owing to its multifactor authentication, which requires the users to verify themselves via multiple sources.

The onset of the festival period towards the end of the second quarter along with some normalisation in consumer spending post the second wave of the pandemic encouraged the launch of customised new offerings for existing as well as new subscribers. Dish TV India launched a special ‘Get 1 for 5 Recharge Offer’, as per which a complimentary month of subscription was provided for every five months of recharge. In addition, a ‘Lucky Recharge Offer’, wherein customers could avail up to 100% cashback on recharge of Rs 501, was also launched.

Household spending, however, did not fully recover during the quarter and despite a fairly extensive sports calendar, recharges were not in line with earlier years. Both streaming platforms as well as DD FreeDish continued to give competition to conventional distributors, with some of the DTH subscribers at the upper end exploring OTT services while those at the lower end sampling Free Dish services.

Consumers typically tend to step up spending during festivals and the festive season traditionally accounts for majority of the annual revenues of the Company. Upbeat consumer spending is expected during the festival quarter this year compared to the same quarter last year.

NTO 2.0

The Telecom Regulatory Authority of India (TRAI) recently extended the deadline for enforcing the New Tariff Order (NTO) 2.0 by announcing an execution plan for migrating subscribers to the new regime. TRAI directed distribution platforms to ensure that subscribers avail pay-TV services as per NTO 2.0 norms with effect from April 1, 2022, moving the earlier December 1, 2021 deadline. While distribution platforms like DTH and cable will have to seek subscriber choice till March 31, 2022, broadcasters will have to submit the required information to TRAI by December 31, 2021.

Several broadcasters had earlier challenged the NTO 2.0 in various High Courts. However, in an order passed on June 30, 2021, the Bombay High Court had upheld the validity of NTO 2.0, except the second proviso to the twin conditions, which stated that the a-la-carte rates of each pay channel (MRP) forming part of a bouquet shall in no case exceed three times the average rate of a pay channel of the bouquet of which such pay channel is a part.

Broadcasters had then approached the Supreme Court challenging the Bombay High Court order. The Supreme Court is yet to announce its decision.

Jawahar Goel, CMD, Dish TV India Ltd, said, “We would be watching the developments on the litigation front for now while simultaneously acting towards implementation of the order.”

Revenues

Dish TV’s operating revenues include subscription revenues, additional marketing, promotional fee & bandwidth charges, advertisement income and other income. The table below shows each as a percentage of operating revenues: